German union's incoming boss warns VW about avoiding unions

By Jan Schwartz

4 Min Read

The logo of German carmaker Volkswagen is seen at a VW dealership in Hamburg, October 28, 2013.Fabian Bimmer

HAMBURG, Germany (Reuters) - The incoming leader of an influential German union warned Volkswagen AG (VOWG_p.DE) on Wednesday about trying to avoid unions in Tennessee, where the German automaker has an assembly plant.

Detlef Wetzel, running unopposed in a late November election to be the head of IG Metall, said companies like VW and industrial conglomerate ThyssenKrupp AG (TKAG.DE) against violating the pro-labor pledges made in their home market by setting up shop in the anti-union U.S. South. ThyssenKrupp has a steel plant in Alabama.

"Low wages and union-free areas: That's not a business model that the IG Metall would support," he told Reuters in a telephone interview. "If companies - from VW to ThyssenKrupp - entered these (southern U.S.) states in order to be free of unions, meaning to not acknowledge a fundamental pillar of any democracy, then we're in North Korea. That cannot be accepted."

VW declined to comment.

IG Metall officials have supported efforts by the United Auto Workers union to represent the hourly workers at VW's plant in Chattanooga, where it builds the Passat sedan. IG Metall represents VW's workers in its home country.

The UAW has pushed VW to accept a German-style labor council at the Tennessee plant that would require the involvement of the U.S. union under American labor law. Volkswagen said in September that it was in talks with the UAW about establishing such a labor council at the Chattanooga plant, which would be a first for the U.S. union.

In Germany, a works council represents both blue-collar and white-collar workers. It represents employees on work rules in the plants and some other dealings with the company, but wages and benefits are negotiated by IG Metall.

The UAW, which lost membership in the past three decades to automation and a cutback of jobs at General Motors Co (GM.N), Ford Motor Co (F.N) and Chrysler Group LLC, wants to organize VW workers to gain a toehold in the U.S. South, where most foreign automakers have non-union factories.

The UAW wants Volkswagen to recognize the union as the representative of workers at Chattanooga, based on cards endorsing the union signed by more than half of the plant's 1,570 workers.

However, a source with knowledge of the thinking of the company's top executive board said last month that the board will ultimately insist on a formal vote by workers at the plant on how they are to be represented.

While not a member of VW's supervisory board, Wetzel said labor representatives and management on the board are in "intense" talks about a solution for the plant.

"I personally campaign for co-determination and I'm ready every day to back every union movement that's being discriminated against in every part of the world," he said.

Meanwhile, VW's top labor leader, Bernd Osterloh, is scheduled to travel to Tennessee to meet with Gov. Bill Haslam and Tennessee Sen. Bob Corker, the former mayor of Chattanooga, to discuss Osterloh's desire that VW's Tennessee workers are represented through a German-style works council.

Both Haslam and Corker have voiced opposition to the UAW's efforts at the VW plant.

Osterloh is an IG Metall member.

A person familiar with the plans, who asked not to be identified, earlier said that the visit would take place in mid-November, but Osterloh's spokesman declined to comment. A spokesman for Haslam had no immediate comment, while a spokeswoman for Corker could not be reached.